Contract Law: Formation, Invitation to Treat, Acceptance and Alternative Dispute Resolution

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Contents
Solution............................................................................................................................................2
The Issues raised..........................................................................................................................2
Applicable Law............................................................................................................................2
Application of Law......................................................................................................................3
Conclusion...................................................................................................................................7
Reference List..................................................................................................................................8

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Solution
The Issues raised
i. Is there any valid contract that is formulated amid the parties. If yes, then who are the
contracting parties?
ii. Evaluation of Bernard status and remedies if available?
iii. Evaluation of Charleen status and remedies if available?
iv. Evaluation of Damien status and remedies if available?
v. Kinds of Alternative dispute resolution and their pros and cons.
Applicable Law
The law of contract is an instrument with the help of which two classified parties enter in
contractual association. It is an instrument created by an offeror and an offeree. (Handbook
2015)
An offror is the primary element which starts the process of contract formation by making an
offer. Any statement in the form of conduct, oral or wrotten when made by the offeror
specufying his intention (in the form of terms) with an expectaion of sanction is an offer. it is
made to an offeree and is considered to be valid and complete when the offeree is in the notion
of the same (Gibson v Manchester City Council (1978).
The offeree consent to the offer terms is an acceptance. To become any acceptance as valid it is
necessary that the acceptance respond to the terms of the offer (Empirnall Holdings Pty Ltd v
Machon Paull Partners Pty Ltd (1988). The respond should not bring any changes to the offer
terms because if any changes are made it terminates the offer so made resulting in a counter
offer (Hyde v Wrench (1840). The original offer stand terminate when the counter offer is made.
(Latimer 2012)
When an offeree gave confirmation to the offer, it is necessary that such approval such come in
the knowledge of the offeror to make the acceptance binding in nature. Intention to make an
acceptance without any communication is nothing and is held in (Felthouse v Bindley (1862).
At times, there is no offer that is made by the parties, but, acts are undertaken to receive offers in
form of issue of advertisements, display of good, tenders, actions, etc. Such acts are invitation to
treat and are not categorized as an offer in law and are analyzed in (Pharmaceutical Society v

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Boots Chemists , (1953)). In invitation, offers are expected by the inviter and upon receipt of the
same if an acceptance is made then there is a concluded contract otherwise not and is analyzed in
(Fisher v Bell (1961). (Robert & Bibi, 1998)
The parties to the contract must make the promises with legal intention. In commercial contract
the legal intention is presumed to be present and the same is absent on domestic contract and is
held in Balfour v Balfour [1919] (Luke 1970)
The promises so made must be supported with something of value called consideration. Also, the
parties must be major and of sound mind. (Latimer 2012)
Application of Law
Alan was a student of Kaplan Higher Education. He took commercial Law and scored good. He
is wishing to sell out his textbook Introduction to Business Law in Singapore. Alan is not
intending t sell his textbook to any person but only to his facebook friends. On 1st November
2015, he posted a statement on his facebook page that all of his friends who are registered in the
Kaplan Higher Education are invited to buy the textbook of Alan. Notes are also provided with
the textbook. The price of selling the textbook was mentioned @$200 and he also stated that
invitation that is made by him is only valid till 5th November 2015.
All the said facts, submits that the action of Alan is nowhere offer. it is an action of invitation to
treat. In Partridge v Crittenden [1968] an advertisement was disregarded as an offer and is
considered on the footing of an invitation.
Also, as per Carlill v Carbolic Smoke Ball Company (1892) the invitaion is made only to specific
prople, The statements by Alan on his facebook page are invitation that are made to specific
people that is, to his friends. So, no other person is permitted to make offer to Alan and the
offers which are received from the friends of Alan are the genuine offers.
Considering all the facts, the above raised issues are dealt individually
Issue i
On 4th November (evening), Damien gave money to Alan which was heartily accepted by Alan.
Though the offer is not made against the invitation that is made by Alan on his facebook, but, it